WASA to issue $38 million in bonds

by Sarah Fay Campbell

The Coweta County Water and Sewerage Authority met Tuesday and approved a resolution to issue $38 million in bonds. The bonds will likely be issued in two separate series.

The authority had originally intended to issue $30 million in bonds. The increase in the amount means there will have to be a new "bond validation" process in Coweta Superior Court.

The increased amount is "due to the opportunity we see to pursue a more favorable debt service structure," said Authority CFO Andrew Caldwell.

The main purpose of the bonds is to allow the authority to even out its debt service. The bonds will be used primarily to pay off or "defease" existing bonds.

Without some action, the authority would see its debt service payments jump significantly in 2016.

Hopes are to also realize some savings, but leveling out the debt is most important.

Exactly which of the existing bonds will be paid off and how the debt will be structured "is still part of the ongoing work that is occurring," Caldwell said. "Depending on which series we go after in terms of refunding or defeasing," there might be legal requirements for different types or series of bonds, Caldwell said. Decisions include the amount in each series and whether they will be tax-exempt or taxable bonds.

The bond issuance has been in the works for months while the authority and its advisors waited on interest rates to be just right, but it looks like they will never be just right, so the decision was made to move forward while they still have the chance. "We are working with our financial advisor and monitoring all market situations," said Caldwell. "That is what is making this transaction tedious."

But they want to "make sure we structure it in the best possible way for the ratepayers and for the authority in the long run." There's a lot of work left to do, and the validation process itself will take three weeks.

"The vote today gave us a resolution to basically start moving forward. The validation process will be a part of moving forward, but there are other things that have to occur before we get that started," Caldwell said.

"Everything kind of plays together: What are the interest rates? What does our debt service need to be at a certain point in time? We have to work all of those moving parts," Caldwell said.